by Elizabeth Hunt, Partner
Effective September 1, 2019, Maine has a brand new probate code. The new code replaces a code that, since its adoption in 1969, had undergone very few changes. The probate code governs a broad array of issues, including the interpretation of wills, the administration of (testate and intestate) estates, guardianships and conservatorships, and many other aspects of estate and probate law. The substantive changes are extensive; some were triggered by court decisions and others by societal changes. We have highlighted a few broad areas in which significant changes were made, but if you would like to view the new code in its entirety, you may do so here.
One of the themes of the new code is an increased emphasis on the intent of the testator. For example, whereas, previously, a court would not look beyond the “four corners“ of a will to determine its meaning, the new code permits the consideration of extrinsic evidence to ascertain the testator’s intent and, in cases of mistake, permits reformation of the will or will substitute, even if its language is unambiguous, to carry out that intent.
On the topic of “will substitutes,“ another theme underlying the new code‘s changes is the recognition of the “nonprobate revolution“ and the vast increase in the use of instruments that are not wills to transfer wealth at death, such as revocable trusts, TOD and POD designated accounts or securities registrations, insurance or annuity contracts, retirement plans and transfer on death deeds. Under the old code, a divorce, for example, would normally operate to revoke a disposition to a former spouse under a will but did not revoke, say, a provision for the former spouse in a retirement plan beneficiary designation. The new code expands the concept of revocation upon divorce by applying it to non-probate transfers, as well as to wills.
Another broad theme underlying the new code’s changes is the acknowledgement that blended and what were previously thought of as “non-traditional“ families are now pervasive. As a result, the new code has significant new provisions relating to stepchildren and the definition of the parent-child relationship (recognizing assisted reproductive technology, for example, and otherwise recognizing the parental role often played by non-biologically related individuals). It also implements a more modern vocabulary to describe family relationships.
Maine‘s guardianship and conservatorship provisions have been completely overhauled by the new probate code. By enactment of the new code, Maine has become the first state to adopt the Uniform Guardianship, Conservatorship and Other Protective Arrangements Act, the intent of which is protecting the rights of the person subjected to the guardianship or conservatorship and pursuing, where possible, less restrictive alternatives. The effect will certainly be to make it much more difficult for family members to become appointed conservator or guardian for a loved one and, once appointed, to perform that role without court involvement. Under this new code, it is more important than ever to have valid powers of attorney and medical directives in place.
With the enactment of the new code, Maine joins 17 other jurisdictions that have adopted the Uniform Real Property Transfer on Death Act, which allows the owner to retain complete control over a property during his/her lifetime, and transfer the property to a designated beneficiary upon the owner’s death, thus avoiding probate of the property.
Another interesting change involves multi-party financial accounts. It is not uncommon for a person to add a family member as a party to an account for purposes of convenience. When establishing such an account, however, it is not always understood what will happen to the account balance upon the primary holder‘s death. Currently, such joint accounts typically automatically pass to the surviving joint owner (often to the surprise and consternation of other family members). The new code now requires that financial institutions provide in their contracts of deposit provisions addressing this issue of whether the customer wants the account balance to become part of his or her estate or whether it passes to the surviving joint owner or other designated beneficiary.
If you have any questions about any of the foregoing issues or any other changes you may have heard about arising from the new probate code, please let us know.